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EUGENE CITY COUNCIL AGENDA ITEM SUMMARY Work Session: Acquisition Update on East Fork Amazon Headwaters - Dillard Road Meeting Date: June 8, 2005 Agenda Item Number: A Department: Public Works Staff Contact: Johnny Medlin www. cl. eugene, or. us Contact Telephone Number: 682-4930 ISSUE STATEMENT This is a work session to update the council on the status of negotiations for the purchase of the South Hills property abutting Dillard Road. BACKGROUND City of Eugene Public Works staff has negotiated to acquire portions of a 90-plus-acre parcel on Dillard Road since summer 2000. Early negotiations, targeted to meet the needs of the Ridgeline Trail and Stream Corridor acquisition programs, resulted in a 54-acre acquisition in October 2001. Since October 2001, staff has placed a high priority on acquiring an additional 8.5-1 O-acre portion which contained important stream corridors estimated to cost $150,000. This area is shown in Attachment C, outlined in red. In 2004, this acquisition strategy shifted to a possible purchase of the entire 39 remaining acres based on the property owner indicating that a price of $300,000 might be acceptable. This area is shown in the Attachment B. The area in yellow is subject property and areas in green are existing parklands. Initially, acquisition of the total parcel was not considered a high priority for the Ridgeline Trail Program because the City had already acquired a connecting corridor for the trail in this geographic area and lacks such in others. However, it was decided that is was worth pursuing if the acquisition of 20 acres for the stormwater corridor and Ridgeline Trail programs would leverage the donation of the additional 19-plus acres. The City's offer of $300,000 for 39 acres was accepted by the property owner in an e-mail on March 22, 2004, but later retracted on April 5, 2004. Staff's understanding was that this retraction was based on the property owner needing to honor a previous purchase agreement with another party. The property was subsequently sold in May 2004 for $325,000 without further involvement of the City. Staff contacted the new owner in June 2004 to determine his willingness to continue negotiations with the City regarding this property. The response was a reluctant willingness to sell for $600,000 if the sale could close by October 1, 2004. Staff informed the property owner that it would likely be impossible to meet this deadline but that a good faith effort would be made in the hope the closing date might be extended. City staff initiated the necessary appraisal work and applied for and received a State Parks matching grant for $300,000. The appraiser worked with a local engineering firm to analyze the development potential of the property. This analysis was necessary to determine if the development potential would support an appraisal closer to the $600,000 asking price instead of the recent purchase price of $325,000. L:\CMO\2005 Council Agendas\M050608\S050608A. doc